Neural networks can reach their true potential only when they are implemented in hardware as massively parallel processors, This paper presents the random-pulse machine concept and shows how it can be used for the modular design of neural networks, Random-pulse machines deal with analog variables represented by the mean rate of random-pulse streams and use simple digital technology to perform arithmetic and logic operations, This concept presents a good tradeoff between the electronic circuit complexity and the computational accuracy, The resulting neural network architecture has a high packing density and is well suited for very large-scale integration (VLSI), Simulation results illustrate the performance of the basic elements of a random-pulse neuron.